New Fairfield Inn depends on financing

Clinton may be getting a Marriott-operated Fairfield Inn & Suites.

It all depends on whether all governing bodies vote to approve a unique way to finance development.

The Anderson County Industrial Development Board unanimously approved an economic impact plan on Feb. 14 that would allow Tax Increment Financing for the development.

A TIF is an incentive that many municipalities use to encourage businesses to relocate to their area.

It offers a tax benefit on the front end to the developer to make a project viable, according to Bear Stephenson, who is a member of the Industrial Development Board.

“All we did was approve it,” said Stephenson. “Then it goes to county commission, and then it has to be approved by the City of Clinton.”

County commission approved it last week.

The hotel would be built off the I-75 122 exit in front of Walmart, on the site of the old hotel that burned down a few years ago. It would feature 82 rooms, an indoor pool and conference rooms.

It has a capital investment of $8.4 million.

The developer for the Marriott, Victor Patel with VRL Hotels 5, LLC, already has financing approved.

They are requesting the TIF because of the money needed to improve the property before they can build on it.

Here’s how it works: the IDB floats the developer money for the improvements, up to $1 million. Then, over the course of 10 years, the money that would normally be paid on property taxes would go back to the IDB, until they’ve paid off their loan.

They would still pay property taxes on the land, but anything beyond that would go back to the IDB.

The downside is that the county and City of Clinton would not receive that money for the life of the loan.

So, with that in mind, county commission passed a resolution to move the hotel/motel tax — which typically is split between the Chamber of Commerce and the Tourism Council and is expected to be around $161,000 a year — over to the general fund. That decision will be deferred to the legislative committee.

The IDB asserts that the county and city would reap the benefits of job creation — at least 25 new jobs and temporary construction jobs — as well as the benefit of more people coming to town and eating at restaurants and shopping at local retailers.

The City of Clinton passed a resolution in favor of the development on Monday night.